Sept. 12, 2001 -- The much-reported "eerie quiet" in New York City merely a metaphor for the sadness and despair in the wake of tragedy. It's also a sign of potential economic trouble ahead.

Lower Manhattan -- normally one of the most crowded spots on the planet, the home of Wall Street, and the nexus of global commerce -- is closed for business.

World leaders have been scrambling to reassure people and ease fears on financial markets. Still, with the U.S. already teetering on the edge of recession, the effects of Tuesday's attack on the world economy could be severe.

The economic costs of the attack will be both direct and indirect. Fear and uncertainty could cut deeply into capital wealth as investors worldwide sell off assets. World financial markets dropped sharply on Tuesday, and reacted with uncertainty on Wednesday, closing mixed. U.S. markets were closed Tuesday and Wednesday, and officials said stock markets wouldn't open again until Friday at the earliest. Bonds could begin trading again on Thursday.

"The economy is open for business," President Bush said in his Tuesday night address to the nation. Other U.S. officials on Wednesday issued similar statements. Deputy Treasury Secretary Ken Dam said "acts of evil will not cripple the markets. Our financial system is, and remains, strong."

The United States and its Group of Seven economic allies said Wednesday they would coordinate their central banks to ensure that the global economy remains stable. Those banks would provide liquidity to markets, if necessary, by making more money available to the banking system. The European Central Bank injected $62.37 billion into European markets to boost liquidity on Wednesday.

Prices of oil and other energy commodities spiked in the aftermath of the attack. Fears of shortages were eased somewhat after Saudi Arabia's Oil Minister Ali al-Naimi said on Wednesday that OPEC producers will cover any oil supply shortage, Reuters reported.

The direct costs of the attack will be immense. The insurance industry may be the hardest hit. Early estimates suggest that losses will be great -- perhaps as much as $20 billion, with property damages making up as much as $5 billion of that. The Insurance Information Institute, a trade group, says this will likely end up being the costliest man-made disaster in history for the insurance industry.

Some individual insurers have already started estimating their losses. Germany's Munich Re said it may lose around $1 billion; Zurich Financial Services said its losses would be "less than $400 billion"; and the Chubb Group issued preliminary estimates of losses between $100 million and $200 million.

Industry estimates put the cost of the disaster in the same neighborhood as Hurricane Andrew in 1992, which cost about $15.5 billion, and the 1994 Northridge, Calif., earthquake, which cost about $12.5 billion.

No other man-made disaster even comes close. The 1993 bombing of the Trade Center caused insured losses of about $510 million, according to the Insurance Information Institute. The Los Angeles riots of 1992 carried an insured cost of $770 million. The Oklahoma City bombing in 1993 cost insurers $125 million.

Some of the costs of this attack may be defrayed by the fact that some insurers included clauses in their policies excluding terrorist attacks.

Some costs of the attacks will be harder to quantify: the slowdown in economic activity stemming from the inability to travel; people being kept home from work; and many businesses being closed in the wake of the tragedy.

The Trade Center itself was home to nearly 50,000 people working for many large businesses, including banks, brokerages, technology companies and legal firms. Morgan Stanley was the biggest tenant. It employed 3,500 people and occupied 25 floors, headquarters of its individual-investor business. Other big businesses there included the New York headquarters of Deutsche Bank AG and MassMutual Financial Group, a large mutual fund company that employed about 600 people.